Halcón Soberano

Listen, you guys need to understand one thing about investing in #mining #stocks. Take it from someone who, as recently as August, was up +6,000% over the past three years from trading the cycles in this sector. Right now, that number is around +4,450%. As you’ve all noticed, riding the downlegs can be extremely brutal. That’s why I became an active investor about seven years ago. I’m always trying to take profits after strong runs and add back after the drawdowns that follows. Some cycles, I look like a genius, trimming very close to the highs and adding back very close to the lows. Other cycles, even I get hit hard. (Cant have a 100/100 track record) This last downleg was one of them. I simply added back too early. I got caught up in the peace deal headlines and became aggressive too soon. That meant watching many of my entries fall another -20% to -25%, and some even -30%. That looks awful. Yeah, I get it. But I couldn’t anticipate that we would experience one of the three worst drawdowns in the past 50 years either. Even so, I still consider those entries very good. Much of that continued weakness happened in brutally oversold conditions, and the recovery from those conditions can be extremely fast and powerful once the sector bottoms. We saw an example yesterday. My portfolio closed +14%, and many stocks finished around +20% for the day. A +50% bounce in #miners from levels this oversold can happen in just one or two weeks. Which brings me to the actual point of this post: Investing in this space isn’t strictly about finding the best fundamental stories. It’s about finding the best entries, one cycle at a time. That’s what created my success. My results haven’t come from simply picking the fundamentally strongest companies. If that had been my only focus, I don’t believe I would have even half the gains I have today. Maybe not even 1/3... Maximizing returns means identifying entries during downlegs that offer the greatest upside potential when the sector turns for its next leg up. Fundamentals are obviously important to support the investment. Sometimes the turn you expect doesn’t happen, and the sector keeps falling for longer than you anticipated, as we just experienced. During those periods, it helps to know you own good companies with solid fundamentals. My portfolio is always built around the near to medium term. I want to maximize returns, so I focus on where I expect the strongest performance over the next leg. Some people ask, “Why own X when Y is a much better company?” My answer is always the same: the best company fundamentally isn’t automatically the stock that will perform best on the next leg up. I care about which stock offers the best opportunity from its current price. With experience, knowledge of mining stocks and strong pattern recognition, you can get very good at identifying those opportunities. And make fortunes.